VANCOUVER—According to central banks including the Bank of Canada, today’s above-average inflation rates are mainly due to global supply-chain disruptions related to the pandemic—and therefore are transitory and likely short-lived—but a host of factors could prolong higher inflation, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
“While COVID’s effect on the economy has certainly contributed to the rising cost of goods and services, if central banks and governments continue their aggressive policies, higher inflation could persist even after the pandemic subsides,” said Steven Globerman, professor emeritus at Western Washington University, resident scholar at the Fraser Institute and co-author of The Outlook for Inflation and Its Links to Monetary Policy.
